Down Payment Grants Available in NC

There are new down payment grants available in NC to help first time home buyers buy a house! The program is not available through all lenders, and it is one that we are really excited to offer. These $15,000 down payment grants are only available in Mecklenburg, Cabarrus, Guilford, Cumberland and Johnston County.

We’ve been notified that there are additional funds being made available October 17, 2016, but only 3000 of these will be made.

The program is being offered as part of the US Treasury Department effort to help counties affected by high foreclosures during the recession. There are no monthly payments, and it can be used with most mortgage loan programs!

New Down Payment Grants Available in NC

There are already two down payment grants available through the State of NC. One program offers a 3% grant, and one offers a 5% grant. The new $15,000 down payment grant works much like the programs already established. These programs can pay the closing costs, down payment, mortgage insurance – pretty much anything associated with buying a house… except repairs.

The newest $15,000 Grant program has no re-payment and no interest as long as you live in the home for 5 years. Each year you live in the home, 20% of the $15,000 is automatically forgiven.

The $15,000 down payment grant AND the current 3% and 5% down payment grant programs are available to anyone who has not owned a primary residence in the past 3 years. There are income caps for the programs based upon the area you are buying in, and with the new $15,000 grant, there’s a sales price limit of $245,000.

A Quick Note

We refer to these programs as “mortgage grants” because there are no payments to be made, there is no interest charge, and there’s no expectation that you will have to repay ANY of the money you receive for down payment, unless you move out of the property or refinance prior to the dates assigned by your specific down payment assistance program.

The literal term for this down payment assistance program is a “forgivable loan.” Under the terms of the program that best suits you, a portion of this down payment assistance will be forgiven on a schedule that we will share with you when you make loan application. These funds are available to us through NC Housing (NCHFA) and are available through other lenders in the state as well. The interest rates for these programs, however, will not vary from lender to lender as that is set by NC Housing.

Qualifying for the New NC $15,000 Down Payment Grant

The NC $15,000 down payment grant program only has 15 Million in available funds. You must take $15,000 – meaning you can’t get a grant for $13,000, you must use all $15,000.

This math means there are exactly 1,000 loans that will be made with this forgivable grant. There’s no indication that the Treasury Department will extend the program, it’s on a first come first served basis.

The Mortgage Grant program has a minimum Credit Score requirement of 640. This means the Middle Credit Score of all borrowers must be at least 640.

The Maximum Sales Price for the new NC $15,000 down payment assistance grant is $245,000. That’s a firm number. You can’t buy a house for $245,000 and then add $5000 for the Seller to pay for other closing costs as you might for other loan programs.

New NC Down Payment Grants By County

The new Mortgage Grant Program is only available in five NC counties. Again, not all banks and mortgage companies offer this grant program (I wish I qualified for it! Seriously?$15,000 free cash!!). New Homes do not qualify for this grant program, and you need to buy a house that’s less than $245,000.

The reason there aren’t more millennials entering the market is simple; they don’t think they can. Having lived through the bursting of the housing bubble, piling up student debt and a difficult job market, home ownership feels like a pipe dream to many millennials.

That’s why $15,000 in FREE CASH to buy a house is so appealing to folks in NC! However, it’s only available in the Counties listed below, and it’s not available from all banks.

Home Buyers in Clayton, McGees Crossroads, Archer Lodge, Smithfield, Benson, Four Oaks, Willow Spring or Kenly should be aware of the newest $15,000 mortgage Grant available to them. It requires that you have at least a 640 credit score, and buy a “used” home at $245,000 or less. New Homes do not qualify for this grant program.

A recent study shows that 60-72% of 25-34 year old rental households overestimate down payment requirements for a new home. They believe that an 11-15% down payment is required and are largely unaware of the down payment assistance programs that are available!

Unlike the other 2 down payment assistance programs that are available through NC Housing (I’ll refer to it here as NCHFA) we must count all household income to qualify for this program. This is very similar to the way USDA Home Loans are calculated. In Johnston County the $15,000 Mortgage Grant is available if you have a household of 1 to 2 people and an income of $76,000. For those families with 3 or more people, the household income is $87,500.

This means that even if a spouse is NOT on a mortgage, their income will be considered when we are determining if you are under the maximum income allowed.

With the 3% and 5% Down Payment Grant programs available, we are only counting the QUALIFYING Income. This is one reason first time home buyers in Johnston County benefit from the Down Payment Grants. If you can qualify on base income (for instance) and we don’t have to use Bonus or Overtime income to qualify you… and that Base income is UNDER the limit of $87,500, then you qualify for a DAP!

With the OTHER Mortgage Grant programs, if we don’t have to use a spouse’s income to qualify you for the mortgage, then it will not put you over the maximum income limit of $87,500. I hope this is making sense, ya’ll can always call us if you think you might be “close” to being able to qualify!

CONCORD NC:

First Time Home Buyers in Concord and Kannapolis and Harrisburg qualify for the NCHFA $15,000 Mortgage Grant if their household income is less than $67,000 for a home with one to two people. For households with 3 or more people anywhere in Cabarrus County, the household income limit is $77,000. New Homes do not qualify for this grant program.

The minimum credit score for mortgage grants in Cabarrus County is 640, and the maximum sales price is $245,000. All homes that meet the minimum program standards, and the maximum sales price in Cabarrus County, NC would be considered for this program.

Houses in Greensboro, Summerfield, Whitsett and “Guildford County” area of High Point qualify for the newest $15,000 mortgage grant from the NCHFA Program. This mortgage loan grant can be used with a FHA Mortgages, VA Mortgage, USDA Home Loan or a Conventional Loan. New, “previously un-lived in” Homes do not qualify for this grant program.

If you are buying a house in Guilford County, you may be eligible for $15,000 in down payment assistance in the form of a five-year, deferred loan at zero interest. Even better, stay in your home for five years and you won’t need to repay the down payment loan – it is forgiven at 20% per year for each full year you stay in the home.

The maximum income limit for a household with 1 or 2 members is $59,000 and the household income limit for a household of 3 or more is $67,000. The minimum credit score for the program, no matter which loan type you choose is 640.

FAYETTEVILLE NC:

Folks who want to buy a house less than $245,001 in Cumberland County, Fayetteville, Spring Lake or Hope Mills should look into the First Time Home Buyer Grants offered right new through NCHFA. The newest Mortgage Grant is for $15,000 – and there’s no interest, no payments, and is forgivable after 5 years!

To qualify for the NC Mortgage Grant, you can have not owned a primary residence during the last 36 months. You need to buy a house that doesn’t need a ton of repairs (CAN NOT BE A BRAND NEW HOME THOUGH) and you need a credit score of at least 640.

The income limits for a family of 1 to 2 people in Cumberland County is $65,000. The income limits for a family of 3 or more is $75,000.

Homes in the Charlotte area, including Mint Hill, Matthews, Huntersville, Dilworth and Pineville that are under $245,000 qualify for the NCHFA First Time Home Buyer Grant Program. Monroe, which is in Union County would not qualify for this program, however those homes would qualify for the 3% and 5% grants.

Houses anywhere in Mecklenburg County that are under the sales price limit, will potentially qualify for the mortgage grant. The money can not be used for repairs, so the home must be in fairly good shape, and meet the program guidelines. New Homes do not qualify for this grant program.

First Time Home Buyers in Mecklenburg County are able to qualify if their household income is less than $67,000 with one to two people in the family, or $77,000 if there are 3 or more people in the family.

Again, broken record here – not all banks offer these programs, and you can not get the $15,000 down payment assistance from one bank and your mortgage from another. These programs work together to help you qualify for a slightly larger home.

Down Payment Grant for First Time Buyer Questions

We get a TON of questions about Student Loan Debt and DTIs, so I figured I would cover those too. The Mortgage Tax Credit actually helps the DTI, because we are able to decrease your payment on a Government Loan by the amount of the credit. If you qualify for the full $2000 – that means we are deducting $166 a month from your overall payment. That can be huge when calculating a DTI.

There’s a “hard” ceiling of 45.0000000000% on all DAPs (or down payment assistance program) mortgages. This mortgage loan grant can be used with a FHA Mortgages, VA Mortgage, USDA Home Loan or a Conventional Loan.

These mortgage grants act as the down payment and cash to close for the mortgage. The money can not be used to pay credit card debt down (for instance) to qualify.

The Mortgage grants available do not have any payments or accrued mortgage interest associated with them. They are forgiven, at a rate of 20% each year. If you sell the home, or refinance before the end of the 5th year, you will owe a portion of this grant back.

The Interest rate for the mortgage programs associated with the Mortgage Grants vary daily – but the rate is actually set by the NCHFA. Every lender in the state is offering the very same interest rate, you can’t get a better rate by calling 15 people. The rates ARE higher than those for “regular” loans with a down payment – BUT you are getting $15,000 with no interest and no payments. As long as you live in the home for at least 5 years, you don’t have to pay a cent of that $15,000 back… we think that equals FREE MONEY.

If you are a First Time Home Buyer – there’s more than just a Rate that you need to ask questions about, what about those First Time Home Buyer Programs that you could be missing?! Have questions about the new NC $15,000 Down Payment Grants?? We want to help you! Call Steve Thorne at 919-649-5058 and get pre-qualified right now! There are ONLY 1000 of these loans available, and they are NOT available from all lenders… so don’t wait, or they could be G-O-N-E!

About Eleanor Thorne

I see myself differently than most loan officers in the Cary/Raleigh market. As a rare Cary native, I see myself as an expert on the area, on mortgage industry changes & factors that effect rates! I've lived in Cary since 1968 - and I'm second generation "mortgage." I work with my husband, Steve Thorne Mortgage Loan Originator #60596 Equal Housing Lender

Hello, I live in Maryland and am interested in applying for this grant near the end of this year. Are interested buyers from out of state able to qualify for this program? I just want to know the process. I hope we can qualify and in time before it runs out.

This mentions a couple times that you only have to repay if you sell or refinance. What if you have to relocate for work but want to keep your house. Can you rent out the property without having to pay any portion of the assistance back?

Mae, yes you qualify for the down payment assistance. How long ago did you sell? To qualify for the Mortgage tax credit, you can not have owned a principal residence for the last 3 years. Call us at 919 649 5058

Is there any update on the 15,000 grant being replenished in November? I know your post suggested that was the earliest you thought it would happen, but I wasn’t sure if that was a definite thing or just conjecture.

Wow great info. Would love to see if I can get the 15k grant and what loan program would work for my husband and I. We will both be first time home buyers and looking for more of a country home then city.

Patrice there’s not a minimum income – but in general, we are going to take your Gross monthly income (before taxes) and take about 30% of that for a house payment. So it will limit the size of the home you buy, based upon the amount of house payment you can qualify for.

Meg, it will depend on how much home you wish to buy. If you make $18,000 gross, in very rough numbers, with no car payment, etc and good credit scores, you MIGHT qualify for a $75,000 house. That’s a moving number as mortgage rates change daily. The best thing to do is call us, 919 649 5058 or fill out an application on the site.

Hi! We are currently beginning the process of purchasing a foreclosure. Are the loans and downpayment assitance programs available for foreclosures? The house also needs some septic work (it is partially on the neighboring land and must be moved or a new one put in), but is in otherwise great condition. Are there loans that will include the costs of those repairs? Or will they have to somehow come out of pocket? Also, we have all the required documents for preaproval save for one tax return that we are waiting to come in the mail. Is that enough for a preapproval/prequalification, or do we have to wait for that document? Thanks in advance for your time.

Kate! Congratulations! Down payment Assistance programs will work for a foreclosure, but the funds can not be used for repairs. You might need a FHA 203k loan, but that is not something we offer. I would suggest calling Prospect Mortgage – most of those guys specialize in this very difficult program. If you can come out of pocket for the repairs, we can help in NC.

Janell that is actually a great question! (I should write about that!)

The funds can be distributed as you need them to be. For instance, if you have some cash, and need the funds for closing costs – they can go for that. If you need them to cover the down payment they can be used for that as well.

Hi Eleanor, I believe I qualify for the 15k grant program. I have one question though regard the requirement that one must live in the house for 5 years. I currently live and work in Virginia, but I claim permanent residency in Guilford County, NC (where I’m from). What does “living” at a property entail? Could I purchase a house and “reside” in it without spending a majority of my days there? What would I have to do to demonstrate that I’m actually living at that property?

Joel, there’s a rule that says you must live within a certain number of miles from your work. Additionally the 15K is for folks who intend to fully occupy the property within 60 days of closing. They could call your loan if they suspect you are not living there.

We are looking to buy our first house in Wake Co. by next June to avoid having to sign a new lease in our apartment. We would like to see what down payment assistance programs we qualify for. We have a combined income of under the 87.5k threshold…Are there any programs for teachers? Rural housing programs (USDA)?

Yes, there are down payment assistance programs, and USDA is available in the Wake Forest area, please see these maps. There’s also a program to help teachers buy a house with as little as $100 down! You are welcome to call us, it’s not too early – our number is 919 649 5058

Angela – that’s pretty hard for me to answer, since I don’t know your debt, etc. Sometimes folks can get cheaper quotes for Homeowners Insurance. You can always call us at 919 649 5058, we do tons of these loans in Charlotte, in fact I’m going to be in Charlotte later today 🙂

Hi Eleanor well i think i was incorrect when i get online and did the DTI calculator, I came up with 19% I have all of my paperwork and would love to talk with you if possible my number is 757-362-1935 also I called the number listed above and left a voice message!!

Hi. I’m interested with the 15k assistance. Me and my husband has gross income in like 45k. We have 2 car loans around $650 both a month. We only have car loan and credit card debt which is 3k. No more other debt. Do you think we qualify? This is our first time buying a jouseb

How is the income determined? Is it done on base pay or W2? I got a bunch of overtime early in the year, but it has since dried up and is never guaranteed. As a result I am less than $1500 over the $87500 threshold. Are there any allowances in the income consideration for this type of situation? I’m a first time home buying veteran.

Wow! You might be able to qualify – it will depend upon the car payments. If you owe more than 1200 a month in car payments, you might have a difficult time – if you have them almost paid off (which I think is what you were saying) then you can probably buy a house! Please call us so that we can go over your exact debt structure – or you can hit the apply now button on the site 919 649 5058

Do you have to get a loan to receive the grant? For instance if the house is $100,000 and you have 85k cash would you be able to get grant for the other 15k? And is there a minimum amount the house has to be that you are purchasing?

Hi, I believe my husband and I qualify. We have a car payment of $369/mo. and our income is definitely way below $87k because we both just started a new job. We’ve been living under my parents’ roof and decided that we need to move out in order to make more space for our family. So we would be first time home buyers in Guilford county. I just want to know if the grants are still available?

David – most lenders in NC are not signed up to do the loans through the State as there are extra requirements, and frankly, as a lender we don’t make as much money on these types of loans. We are the LARGEST down payment assistance lender in our area, and we do tons of them all across the state. We’d be glad to help you.

In answer to the other part of your question – yes, there is a trade off. The programs that are providing you with the down payment assistance do have higher mortgage rates. Not SUBSTANTIALLY higher, but the trade-off is that you are not having to come up with those thousands of thousands of dollars.

Hi, If my wife and I make about 145,000 per year are there any programs out there for us to help with downpayment? Any grants or waivers? We are looking at a finance company but we both work in the medical field and were hoping to find some kind of program that integrates with FHA. Please help. I’m glad to research but haven’t been able to find anything. Just need a point in the right direction.

There are Good Neighbor Next Door and $100 down payment that might help. What area are you interested in? There are parts of NC that will qualify for the next 2 years under Natural Disaster programs from FNMA and FHLMC.

Hello. We plan to buy a townhome around August or July. I know buying a house could take up to 3 months. When do you think is the best time to apply for this? Will this be available around May this year? Is town house eligible for this program?

There are several down payment assistance programs that will continue to be ongoing Town Homes are eligible for the program. I would talk to a Loan Officer now, so that you know what you might need to have in savings, or what your payment might be. But certainly, you would want to call by May. Our number is 919 649 5058, and we would love to help!

HI, I see that there are several down payment grant programs are we only allowed to apply for one grant, or are you familiar with all the different grants and you a will either help anyone apply to all grants possible or show them where to apply

if the house I want to buy costs 75k, to be able to not to pay for PMI, I have to put money down of 15k for this amount. Im thinking if I could get approve for the down payment assistance of 15k, do I have to put money down from it of my pocket? I don’t have savings right now but I want to buy a house

Gary, wee offer multiple programs, and we are doing a loan right now for folks who are using both NC Housing Finance Agency and the City of Raleigh program. If you would call us we would be glad to look at what down payment assistance programs you would be available for.

I have been promoted to a partner position in Greensboro nc and am looking at property In the northern Guilford school district. We are from va and were looking to buy here till transfer. Could we qualify for any no Down payment and no closing cost mortgage? Thanks for your time

Which credit agency do you use as reference? Under Equifax, my wife and I are at 627 combined but would love to work on qualifying for this grant. As far as the DTI, how does it work if student loans are deferred?

Juan, I think you will want to read this : http://ncfhaexpert.com/front-page/buying-house-student-loans-deferment/ Currently, if you have Student Loans in Deferment, we are generally required to count 1% of the balance in your DTI. If you are applying for a Grant, that would be the case as even the Conventional Down Payment Assistance Programs are Fannie Mae Loans. Freddie Mac is the only place where we can count exactly what’s on the credit report with Student Loan Debt, and you would need a 5% down payment.

This information is inaccurate. The limit for income is $59,000 for one or two person households. Also, to clarify, the middle score of the individual with the lowest credit scores is what is used. Credit scores are not averaged between both borrowers.

Randall, for a W2 buyer, the underwriter takes the most recent paystub and projects out the expected income. If there are other income streams on the transcripts, Dividend Income, Royalties, etc then that income is added to the W2 income. If self employed, it is not gross income, it’s net after expenses income that is used.

Any lender is going to have a problem with that. It would look too much like development property in my opinion. You could call Housing at 919 877 5700, but I don’t think a Lender is going to want to do that deal. It needs to be re-recorded as one plat.

Hi, I’m currently working with a local community development group and they’ve pre-qualified me for a CPLP loan with a 20% interest free, payment free loan to combine with an FHA loan. I am favoring buying in Cabarrus/Concord, can any of these grants stack with these? I’m sitting at about 45k with a family of 3.

I’ve now been told by the local program that they can’t be combined because both come through the same agency. But the community development corp I’m working with doesn’t often work in Cabarrus and I’m trying to find a second opinion. If they actually can be combined I think our available housing options would increase substantially.

Keith I am familiar with the NCHFA Programs. Because email is not ideal, can you please call us at 919 649 5058. Steve’s mom had a stroke, so we are returning calls. When you leave a message, please tell Steve that I asked you to call him regarding NCHFA in Cabarrus County. One of us will call you back today. Thank you again for allowing us to be a resource for you.

Jasmine, when you are ready to buy a house, so after you have your credit in check, you should take them out of deferment and set up a payment plan. You can give your loan officer the paperwork verifying what your payment will be. Your scores will be higher if you add revolving credit and pay the balances down on the ones you have

Hi, I was wondering about the $15000 down payment assistance grant. My boyfriend and I are thinking of buying a house together in Guilford county. We are not married and do not plan to get married. He will be a first time homebuyer. Our income together will be over the Guilford county guidelines. Since we are not married would he qualify on just his income or would that only work if he was the sole applicant for the mortgage?

Ronda – he needs to apply and buy the home on his income. You can not write the Earnest Money check, that’s one of those things that can get tricky. I suggest this, because you are going to be over the limit. Doesn’t really matter that you are not married – that only counts if you were applying for a VA Mortgage Loan. We would be glad to help! You can call us at 919 649 5058, we help folks all over the state.

Joanna, if you set up a payment plan, and pay each month for 6 months, you should be fine. You can go ahead and apply now, and we will walk you through the process. Congratulations! You’re going to buy a house!

Hi Eleanor, My husband and I are trying to begin the process for the 15,000 grant program. How do we start this process? Also, is it required to be preapproved for a loan amount through a bank? I just called your phone number and left a voicemail as well. Thanks!!

Hi Ellen, we owe tax in 2016 but we’re paying it in full in July. I already called IRS about it. Is it possible that we still qualify for the 15k down payment assistance in July or August? Also I’ve been calling but always in voicemail.

Yes, there are several NC Housing Forgivable loan programs available – plus as far as I can tell the whole county qualifies for USDA Home Loan financing – which is a better program. Call us and we will be glad to help. There’s no down payment requirement for these loans, and the mortgage interest rates are lower.

If you are over the income limits, you might want to consider the USDA Home Loan program as those limits are generally higher. If you are looking for a home in NC, please call us, and we will go through all of your options with you 919 649 5058

Do you know if any $15,000 grants will be issued for the 2018 year? Looking to move in the spring of 2018 and this grant could be very beneficial to my family. Our (mine and husband’s) credit scores are in the 620 range according to credit karma, but we have been steadily building them up and it should be in the 640 range soon.

Brandy there probably will be no more of the $15000 Grants made. This is a Federal (Treasury) program, and I think we’ve tapped out of those funds. Currently there are approximately 400 more loans that can be made.

Good morning, I’m currently renting and have 6 months left on my lease, I would really like to try and buy a house next year but coming up with the down payment is a hard for me at this time. How can this program help?

We have a brand new program that gifts the 3% down payment. There are multiple ways to buy a house with no down payment, the trick is to have a credit score that meets the requirements. Each program has it’s own standard. You can call us at 919 649 5058 and we’ll be glad to go over the program that will work best for you!